Walmart Is Both Expanding Parental Leave & Laying Off Thousands Of Workers

Natalie GontcharovaJan 11, 2018 3:50 PM

Today, Walmart is both majorly expanding benefits for workers and laying off thousands in its Sam's Club chain. The company will offer parental leave to its full-time hourly associates, a move that's expected to influence other companies' decisions given that it's the largest private employer in the country.

According to a statement from Walmart, full-time hourly associates in the U.S. will now get 10 weeks of paid maternity leave and six weeks of paid parental leave — the same as salaried workers. Previously, they received only six to eight weeks of maternity leave at half pay — there were no benefits for dads, many same-sex couples, and adoptive parents.

Walmart is also raising salaries for new employees from $10 to $11 an hour and offering a one-time bonus to associates based on how long they've worked there, ranging from $200 to $1,000. The company currently has over a million hourly associates in the U.S., both full- and part-time, and about 1.4 million employees total nationally. Same-sex couples, adoptive parents, and foster parents are included in the policy, and the company is also creating a $5,000-per-child fund to help employees adopt.

At the same time, Walmart is abruptly closing 63 Sam's Club stores across the country, the company told Business Insider, which is resulting in thousands of workers losing their jobs. Some closed today, while others will close at a later date.

BI reported that many employees weren't informed of the closings before showing up for work today, learning about them when they saw signs on the stores' doors. Walmart plans to turn 10 of the stores into e-commerce distribution centers and their employees will be able to reapply for positions at those locations.

"After a thorough review of our existing portfolio, we've decided to close a series of clubs and better align our locations with our strategy. Closing clubs is never easy and we're committed to working with impacted members and associates through this transition," Sam's Club posted on Twitter.

Walmart did not respond to Refinery29's request for comment on whether the two decisions are related.

Corporate Vs. Hourly: A Big Difference

While white-collar workers have been benefiting from the "talent war" to attract top-level workers, low-wage workers are often left out of these benefits — sometimes even at the same companies.

Brianna Cayo Cotter is the chief of staff for PL+US: Paid Leave for the U.S., a small nonprofit that advocates for paid leave with the goal of eventually building momentum toward creating a federal policy, something the U.S. does not have.

Cayo Cotter says her group's research shows a huge gap between the benefits corporate, white-collar employees enjoy and those provided to hourly workers such as cashiers. According to a report from May 2017, 94% of low-wage working people in the U.S. have no access to paid family leave. It's much more likely for a worker to have this benefit if they make over $75,000, rather than under $30,000.

But that might be starting to shift: Companies including Ikea, Nordstrom, and Bank of America have all instituted paid leave policies for hourly workers recently, according to the above report. Now, says Cayo Cotter, her organization is closely working with Starbucks and others who are yet to close the gap. At Starbucks — which has touted itself as a leader among retailers when it comes to employee benefits — it's been a slow drip. It currently offers 18 weeks of leave for birth moms and 12 weeks for dads and adoptive parents to corporate employees, but to "field" employees — baristas — just six weeks, and only to birth moms.

"It sees itself as a real leader in employee benefits and treatment, but now Walmart has outdone them," she says.

Cayo Cotter says she thinks Walmart will be able to influence other companies to move the needle. "I think that Walmart making this move is going to be very significant — if you want to be a competitive business in this country, now you have to be paying parental leave to all classes of workers," she says.

The Caregiving Question

Several U.S. states have instituted, or are discussing, family leave policies that expand beyond parental benefits to help employees who need to take care of a sick parent or other family member, with New York state the most recent to implement policy on the issue. Just 21% of leaves from work are for new babies, according to another PL+US report, and most companies don't offer this type of leave.

Over the past year, Adobe and Facebook have announced paid caregiving leave, but only two of the U.S.' 70 largest employers offer it: Deloitte (16 weeks) and Cargill (two weeks). Only about a third of top employers offer short-term disability to fill the gap, according to PL+US.

Walmart's policy is far from perfect: It doesn't cover caregiving or part-time employees, for instance. But it's a significant improvement. "There's a wave of employees at all types of companies across this country that are ready to fight for paid family leave — and apparently they can win," says Cayo Cotter.

We've reached out to a Sam's Club spokesperson for more information about the closings and layoffs and will update this story when we hear back.